cash-on-cash return

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Cash-on-cash return

A method used to find the return on investments when there is no active secondary market. The yield is determined by dividing the annual cash income by the total investment. See: Current yield or yield to maturity.

Cash-on-Cash Return

A way to calculate the rate of return on an investment, especially in real estate. One calculates the cash-on-cash return by dividing the cash inflow on the investment in a given year by the cash outflow originally made. For example, if one buys a property for $100,000, this amount is the denominator when calculating the cash-on-cash return each year.

cash-on-cash return

See cash-on-cash.

References in periodicals archive ?
At the time of the acquisition, the property had a net cash flow, before capital improvements of $476,000, yielding the investors a cash on cash return of 9.
This reduces the cash flow to $175,000, reducing the cash on cash return to 3.
The third major method of evaluation is known as the cash on cash returns approach, or cash flow analysis.